SentimenTrader Blog


2020-09-26 | Troy Bombardia | Premium

Yale publishes a monthly Crash Confidence Index (along with other indices) which looks at the % of institutional and individual investors who believe that a stock market crash will be avoided in the next 6 months. This figure has dropped to an all-time low among individual investors and is at the lowest level in over 2 years among institutional investors.Respondents to this survey have had a mixed track record of success. When so few institutional investors believed that there will be no ...

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2020-09-26 | Troy Bombardia | Premium

We live in uncertain times. Global pandemic, geopolitical turmoil, recessions - all of these contribute to peoples' general sense of unease. As Bloomberg noted, the gap between first month VIX futures and spot VIX is at the highest level in years. Perhaps this is due to election uncertainty:When this happened in the past, the S&P had a tendency to pullback over the next 2 weeks. But most of the historical cases were from more than 10 years ago:On the otherhand, VIX had a tendency to rally ...

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2020-09-25 | Jason Goepfert | Basic

Breadth in the high-yield bond market has turned negative for the first time in months, with more bonds hitting 52-week lows than highs. That has weighed on sentiment which is registering short-term pessimism. When internal momentum turns like this, it has typically meant more short-term downside but should be a good longer-term sign.

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2020-09-25 | Jason Goepfert | Basic

Breadth in the high-yield bond market has turned negative for the first time in months, with more bonds hitting 52-week lows than highs. That has weighed on sentiment which is registering short-term pessimism. When internal momentum turns like this, it has typically meant more short-term downside but should be a good longer-term sign.

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2020-09-25 | Jason Goepfert | Lite

Almost all financial stocks are below their 50-day moving averages for the first time in months. And most are below their 200-day averages, too.

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2020-09-25 | Troy Bombardia | Premium

The U.S. housing market continues to rebound along with the broad U.S. economy. Housing, which is typically a leading indicator of recessions and bear markets, was not effective this time in predicting the March 2020 recession and stock market crash. But that's mainly due to the unprecedented nature of the pandemic, illustrating a rare problem with historical analysis - sometimes, something very different comes along. Sometimes, "this time is different" (but very rarely). Traders who thought ...

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2020-09-24 | Jason Goepfert | Basic

For the first time since May, fewer than 15% of financials managed to hold above their 50-day moving averages. This comes during a poor market environment for the sector, with fewer than 50% of them above their 200-day averages. This has led to much worse returns than when more than 50% were above their long-term trends.; The Russell 2000 became the first of the 'big four' indexes to close below its 200-day average after all 4 had been rallying. It also ended a medium-term rally within a much larger downtrend for the index. Similar behavior in the past led to short-term declines, but not much beyond that.

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2020-09-24 | Jason Goepfert | Basic

For the first time since May, fewer than 15% of financials managed to hold above their 50-day moving averages. This comes during a poor market environment for the sector, with fewer than 50% of them above their 200-day averages. This has led to much worse returns than when more than 50% were above their long-term trends.

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2020-09-24 | Jason Goepfert | Basic

The Russell 2000 became the first of the 'big four' indexes to close below its 200-day average after all 4 had been rallying. It also ended a medium-term rally within a much larger downtrend for the index. Similar behavior in the past led to short-term declines, but not much beyond that.

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2020-09-24 | Jason Goepfert | Lite

For the 1st time in months, the U.S. dollar has managed to rise above its 50-day moving average.

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